The Institutional Limited Partners Association has largely wrapped up work on a standard reporting format that it hopes private equity firms will adopt for quarterly and annual reports sent to investors.
The guidelines are “pretty much ready to go,” said Kathy Jeramaz-Larson, executive director of ILPA, in an interview with peHUB earlier today. Among the matters left to be settled: what form to distribute the new standard in, and how to distribute it.
ILPA, which has already shown the proposed format to members, was set to host a CFO roundtable early this week in New York to get wider feedback prior to publication. Jeramaz-Larson said she expects about 50 people to attend, including CFOs from a diverse group of GPs, as well as their counterparts working in the back offices of LPs.
That the industry has never had a standard reporting format has proven a major headache for both sponsors and investors. LPs get their regular updates in so many shapes and sizes that they spend countless hours re-keying data into portfolio-management systems (or hire others to do it for them). Investors or their service providers also must place follow-up calls to GPs to obtain missing data. For their part, GPs have to devote resources to answering questions from LPs and fulfilling special data requests.
Jim Pittman, VP–private equity at PSP Investments and an ILPA board member, is chairman of the working group that developed the standard reporting format. The working group has already published standard formats for capital calls and distribution notices.
According to the ILPA Web site, the effort to develop a standard reporting format is designed “to generate greater industry efficiencies, improve uniformity and transparency, and reduce expenses in administering and monitoring private equity investments.”
Founded in the early 1990s, ILPA has grown to more than 240 members with more than $1 trillion of private equity assets under management. It made a splash in 2009 with the publication of a set of “private equity preferred returns” that has helped LPs negotiate more favorable partnership terms and conditions.